A multinational company enters a new geographical location, considered an emerging
market, with its established product line: laptops and tablets. Which of the following
would NOT serve as a good strategic move to enhance profits?
A. Creating a sales plan that aims to enhance initial sales and market share with low
prices based on high operational costs
B. Devising a marketing plan that aims at different customer segments with attractive
advertisements and offers on products
C. Implementing a diversification plan that aims at adding smartphones to the existing
line of products
D. Charting an acquisition plan that aims at acquiring small-scale companies looking
for funding and with a similar product lineup
E. Establishing a distribution plan that aims at setting up more supply outlets than any
other rivals in the location
Which of the following is an activity a company engages in to enhance the quality of
life for its employees in an attempt to fulfill its corporate social responsibility?
A. It fires suppliers that use child labor.
B. It provides work-at-home opportunities.
C. It donates a percentage of its profits to a national charity.
D. It pays to have litter removed from a state highway.
E. It sells its products at a discounted price in underdeveloped countries.
The broad areas that internal information business systems need to cover include all of
the following EXCEPT:
A. financial performance data.
B. corporate culture data.
C. customer data.
D. operations data.
E. employee data.
According to the school of ethical universalism:
A. concepts of what constitute ethical behavior and unethical behavior are dictated by
subjectively provable moral principles but not by objectively provable moral principles.
B. concepts of right and wrong are universal within countries/societies but not across
countries or cultures.
C. concepts of what is ethical and what is unethical are socially determined, leaving
room for variation from country to country or circumstance to circumstance.
D. to the extent there is common moral agreement about right and wrong actions and
behaviors across multiple cultures and countries, there exists a set of universal ethical
standards to which all societies and all individuals can be held accountable.E. all
societies and countries are obligated to apply universally defined ethical principles of
right and wrong as set forth by a global body that formulates the Code of Ethical
Behavior for the world.
As a rule, the collective impact of competitive pressures associated with the five
competitive forces:
A. determines the strength of the industry’s driving forces.
B. determines the extent of the competitive pressure on industry profitability.
C. means that fewer companies can achieve a competitive advantage via anything other
than being the industry’s low-cost leader.
D. means there will be a larger number of competitive advantage opportunities for
industry members.
E. means there will be a greater number of industry key success factors.
The chief difference between a low-cost provider strategy and a focused low-cost
strategy is:
A. whether the product is strongly differentiated or weakly differentiated from rivals.
B. the degree of bargaining power that buyers have.
C. the size of the buyer group that a company is trying to appeal to.
D. the type of value chain being used to achieve a low-cost competitive advantage.E.
the number of upscale attributes incorporated into the product offering.
Pursuing continuous quality improvement as a uniqueness factor is sound because it:
A. can create differentiation even if little tangible differentiation exists otherwise.
B. bestows the first-mover-in-the-market advantage on companies practicing it.
C. can often reduce product defects and improve economy of use.
D. always provides a competitive advantage.E. provides wider product variety and
selection through product versioning.
Factors that cause the rivalry among competing sellers to be weaker include:
A. low buyer switching costs.
B. low fixed costs or storage costs.
C. many industry rivals of roughly equal size and competitive strength.
D. weakly differentiated products among rival sellers.
E. slow growth in buyer demand.
When strategies fail, it is often because of:
A. poor execution of the strategy.
B. shortfalls exposed with the strategic management design process.
C. inadequate support for the management team responsible for the planning process.
D. secondary operating practices that hinder the required changes.
E. lack of sufficient information about operating systems.
The objectives of a well-crafted strategy require management to strive to:
A. match rival businesses’ products and quality dimensions in the marketplace.
B. build profits for short-term success.
C. realign the market to provoke change in rival companies.
D. develop lasting success that can support growth and secure the company’s future
over the long term.
E. re-create their business models regularly.
What is the business term given for a company that generates cash flows over and
above its internal requirements and can provide the corporate parent with funds for
reinvestment?
A. Cash hog
B. Cash cow
C. Cash chest
D. Free cash flow
E. Cash generator
When a corporate parent creates an independent company and divests it by distributing
to its stockholders new shares in the business, it is called:
A. a spinoff.
B. a wholly-owned subsidiary.
C. a functional divesture.
D. fully-diluted stock.
E. a restructure.
Which of the following is NOT one of the pitfalls of pursuing a differentiation strategy?
A. Over-emphasizing efforts to strongly differentiate the company’s product from those
of rivals rather than being content with weak product differentiation
B. Offering trivial improvements in quality, service, or performance features
C. Overcharging for the differentiating features
D. Adding so many frills and extra features that the product exceeds the needs of buyers
E. Overspending on efforts to differentiate the company’s product offering
How is a functional structure or unitary structure organized?
A. With a central executive handling all major decisions
B. To lighten the load of senior executives so they can concentrate on value chain action
agendas
C. Specifically to manage unrelated diversification opportunities
D. Into functional departments, with departmental managers who report to the CEO and
small corporate staff
E. With top-heavy management, and senior executives forming a central office of the
chairman